Ross 2014 Annual Report Download - page 45

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Other long-term liabilities. Other long-term liabilities as of January 31, 2015 and February 1, 2014 consisted of the following:
($000) 2014 2013
Income taxes (Note F) $ 101,696 $ 104,944
Deferred compensation (Note G) 94,054 88,269
Deferred rent 59,465 64,671
Tenant improvement allowances 19,562 19,744
Other
4,723 9,939
Total
$ 279,500 $ 2 87, 567
Lease accounting. When a lease contains “rent holidays” or requires fixed escalations of the minimum lease payments, the
Company records rental expense on a straight-line basis over the term of the lease and the difference between the average
rental amount charged to expense and the amount payable under the lease is recorded as deferred rent. The Company begins
recording rent expense on the lease possession date. Tenant improvement allowances are included in Other long-term liabilities
and are amortized over the lease term. Changes in tenant improvement allowances are included as a component of operating
activities in the Consolidated Statements of Cash Flows.
Revenue recognition. The Company recognizes revenue at the point of sale and maintains an allowance for estimated
future returns. Sales of stored value cards are deferred until they are redeemed for the purchase of Company merchandise.
The Company’s stored value cards do not have expiration dates. Based upon historical redemption rates, a small percentage
of stored value cards will never be redeemed, which represents breakage. The Company recognizes income from stored value
card breakage as a reduction of operating expenses when redemption by a customer is considered to be remote. Income
recognized from breakage was not significant in fiscal 2014, 2013, and 2012.
Sales tax collected is not recognized as revenue and is included in Accrued expenses and other.
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